U.S. Sen. Richard Burr (R-NC) on July 22 introduced a bipartisan bill that would allow eligible small employers to participate in the Paycheck Protection Program (PPP) and claim the Employee Retention Tax Credit (ERTC) so that their workers could remain on the payroll and pay for their healthcare coverage.
The proposal, Sen. Burr said, “will improve the coordination between these two existing programs and help Main Street businesses overcome this economic uncertainty” associated with the COVID-19 pandemic.
Sen. Burr cosponsored the Employer Assistance Coordination Act, S. 4268, with bill sponsor U.S. Sen. Maggie Hassan (D-NH), which also would include rules to prevent “double-dipping,” so that employers cannot use funds from both programs for the same wages, according to a one-page summary of the bill.
For example, under the Employer Assistance Coordination Act, an eligible small employer that received PPP assistance could use that funding to cover eight weeks of payroll and other expenses. Then, after exhausting the PPP assistance, employers could claim the 50 percent ERTC for the first $10,000 in wages and health plan costs for each employee, according to the summary.
As with the current ERTC, small employers would claim this fully refundable tax credit by immediately reducing their payroll tax payments and receive any excess credit as an advanced payment from the Internal Revenue Service, the summary says.
“Small businesses across the nation continue to face unprecedented challenges,” said Sen. Burr. “One way we can help is by giving eligible small businesses and nonprofits the ability to retain their employees and continue to provide healthcare coverage.”
The bill has garnered support from the U.S. Chamber of Commerce and the National Federation of Independent Business.